IP telephone prices decline 7%

In Q2 2003, the average selling price (ASP) of an IP Telephone fell 7% QTQ to $193. This drop can be largely attributed to the market leader, Cisco, who reduced some prices and introduced new low cost models. We are forecasting more modest ASP declines during the coming year (to $185 in Q2 2004) as most IP Telephones continue shipping on enterprise PBXs, where phone choices are limited by proprietary protocols. Further into the future, ASPs should decline more quickly as more IP Telephones ship for service provider VoIP offerings, where open-standard, lower cost phones will dominate.